Dow dives nearly 500 points, wiping out its gains for the year

Wall Street wiped out gains for the year Thursday as concerns about a cocktail of factors including trade tensions, Treasury yields, and energy prices weighed on global markets, extending losses following the worst day for US equities in seven weeks.

The Dow Jones Industrial Average shed 1.95%, or more than 487 points. The Nasdaq Composite fell 1.99%, and the S&P 500 was down 2.02%.

Selling pressure on futures was so strong in the first six minutes of trading that the CME Group Inc. was forced to intervene with market pauses to prevent severe price movements, according to Bloomberg.

Wall Street had suffered its worst day since October on Tuesday as expectations for a trade deal between Washington and Beijing unwound and after sections of the yield curve inverted. The stock market was closed Wednesday, a national day of mourning for former President George H.W. Bush who died over the weekend.

RELATED: Take a look at the state of the New York Stock Exchange before the election:

11PHOTOS

New York Stock Exchange before the election

See Gallery

New York Stock Exchange before the election

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 7, 2016. REUTERS/Brendan McDermid

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 7, 2016. REUTERS/Brendan McDermid

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 7, 2016. REUTERS/Brendan McDermid

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 7, 2016. REUTERS/Brendan McDermid

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 3, 2016. REUTERS/Brendan McDermid

Pedestrians walk along Wall Street near the New York Stock Exchange (NYSE) in New York, U.S., on Monday, Oct. 31, 2016. U.S. stocks rose from a six-week low amid an increase in deal activity as traders assessed the outlook for the presidential election and interest rates in the world's largest economy. Photographer: Michael Nagle/Bloomberg via Getty Images

NEW YORK, NY - NOVEMBER 01: Traders work on the floor of the New York Stock Exchange (NYSE) on November 1, 2016 in New York City. As Wall Street continues to feel election uncertainty, the Dow Jones closes fell more than 100 points. (Photo by Spencer Platt/Getty Images)

A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Friday, Nov. 4, 2016. U.S. stocks fluctuated amid payrolls data that bolstered speculation the economy is strong enough to weather higher interest rates, while investors remained wary before the looming presidential election. Photographer: Michael Nagle/Bloomberg via Getty Images

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Friday, Nov. 4, 2016. U.S. stocks fluctuated amid payrolls data that bolstered speculation the economy is strong enough to weather higher interest rates, while investors remained wary before the looming presidential election. Photographer: Michael Nagle/Bloomberg via Getty Images

NEW YORK, NY - NOVEMBER 01: Traders work on the floor of the New York Stock Exchange (NYSE) on November 1, 2016 in New York City. As Wall Street continues to feel election uncertainty, the Dow Jones closes fell more than 100 points. (Photo by Spencer Platt/Getty Images)

A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Monday, Oct. 31, 2016. U.S. stocks rose from a six-week low amid an increase in deal activity as traders assessed the outlook for the presidential election and interest rates in the world's largest economy. Photographer: Michael Nagle/Bloomberg via Getty Images

Up Next

See Gallery

Discover More Like This

HIDE CAPTION

SHOW CAPTION

of

SEE ALL

BACK TO SLIDE

Canadian authorities said they arrested Meng Wanzhou, the chief financial officer of the Chinese cellular giant Huawei Technologies, on charges related to alleged Iran sanctions violations. The December 1 arrest cast doubt on trade relations between Washington and Beijing, who agreed over the weekend to pause tariff escalations for negotiations.

Optimism around the trade-war ceasefire has since waned after President Donald Trump called himself "a Tariff Man" in a tweet about Beijing, cementing expectations for further trade escalations between the largest economies if a deal isn’t reached within the next three months.

"The market's in repair mode following one of the worst equity selloffs of the year," Mark McCormick, a strategist at TD Securities, said in an email.

"There are many moving parts to the puzzle and yet Tariff Man's tweet looms large. It also wreaks of a classic 'buy the rumor, sell the fact' trade where the market priced in a bulk of the good news weeks ago."

Treasury yields continued to slide Thursday, with the 10-year down 6.3 basis points to 2.86% and the 2-year 8.6 basis points lower at 2.725%. Spreads between some long- and short-term bonds inverted this week, an occurrence seen as a potential recession signal, for the first time since the financial crisis. The dollar slipped 0.4% against the Japanese yen.

Oil prices slipped further into a bear market after OPEC reportedly reached an agreement to slash coordinated output levels but was waiting for Russia to agree. West Texas Intermediate dropped 3.3% to around $51 per barrel, and Brent fell to just below $60.